Sprint Nextel (NYE: SS) has taken several strategic steps over the last few weeks that have resulted in its stock breaking its 52-week trading high of $4.63. It closed Thursday at $4.80. These steps have also roused the bulls, which have been considerably active in the options market, especially for the August calls.

Call volume for the August 5 strike is 18,105. It is the largest for the month. Open interest was 11,553. Options traders for this contract increased their investment by 100%. Volume for the August 4.50 strike was 6,066 and the open interest was 30,378.

Put volume was up, but not as much as calls. The August 5 calls had a trading volume of 1,939 and open interest of 4,541. Open interest for the put with a strike price of $4.50 was 19,095. The volume traded was 2,015.

Anxious about how the stock will be trading by the time the August call contracts expire? You might consider a covered call strategy, which is the combination of being long the stock and short a call option.

The August 5 call was out of the money as of Thursday, Aug. 9. For out of the money (OTM) options, upside potential is the strike price minus the current stock price, notes Born to Sell. One of the reasons you may want to choose an option that is out of the money is if you think the stock may go up between now and option expiration. This can provide you with some potential upside if it does. Remember, there is more risk involved with out of the money options; there is less downside protection.

OptionsMonsters pointed out that the November 5 calls drew 11,148 buyers and the sale of roughly the same number of August 4 calls. It also noted that "volume was below open interest in the August options, but not the November contracts, which indicates that an existing position was closed and rolled to the higher strike."

As I've said in several stories I've written about options, a high level of open interest is good for investors because it means there is more liquidity for the call option being traded. Having more liquidity can give the investor just a little more peace of mind in case the need arises to close out the position before the strike expiration date.

All of these will expire on Aug. 17. Considering Sprint's stock has doubled since May, and it continues to rally on more and more good news, I don't see it falling by the time the August contracts expire.

One of the biggest moves Sprint made at the beginning of the month entailed selling $1.5 billion of notes to finance a host of things, including funding Clearwire Corporation and its subsidiary Clearwire Communications LLC.

The deal is expected to close on Aug. 14. To understand the importance of this deal and why Sprint would be willing to refinance debt to make it happen, you must understand the importance of wireless spectrum.

Sprint is trying to keep up with its main competition: Verizon Wireless (NYSE: VZ) and AT&T (NYSE: T). For all of these companies, spectrum is key to their being able to grow their LTE capacity. Wireless data usage has increased exponentially due to more people eating up network capacity with their smartphones and tablets.

Last week, AT&T announced it was buying NextWave Wireless in an attempt to meet its spectrum needs. The deal, worth $600 million, must be approved by the FCC.

In trying to build out their LTE networks, both Sprint and AT&T are trying to catch up with Verizon, which is the largest mobile carrier in the country. They have their work cut out for them, as Verizon is also on a tear to meet its spectrum needs. It is buying it from Comcast (NYSE: CMCSA) and Time Warner Cable (NYSE: TWX). The deal is worth almost $4 billion.

With its major competitors making moves to stay on top of meeting the increasing amounts of data customers are accessing, it is no surprise that Sprint is going all out to stay in the top three. For the options bulls, this marks an excellent time to hedge bets that the stock will continue to rise as Sprint seems poised to increase shareholder value by remaining as competitive as possible.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.